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PepsiCo (PEP) Gains But Lags Market: What You Should Know
PepsiCo (PEP - Free Report) closed the most recent trading day at $178.01, moving +0.24% from the previous trading session. This move lagged the S&P 500's daily gain of 1.3%. Meanwhile, the Dow gained 0.98%, and the Nasdaq, a tech-heavy index, added 7.48%.
Coming into today, shares of the food and beverage company had gained 0.74% in the past month. In that same time, the Consumer Staples sector lost 1.2%, while the S&P 500 lost 2.95%.
PepsiCo will be looking to display strength as it nears its next earnings release, which is expected to be April 25, 2023. On that day, PepsiCo is projected to report earnings of $1.37 per share, which would represent year-over-year growth of 6.2%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.18 billion, up 6.05% from the year-ago period.
PEP's full-year Zacks Consensus Estimates are calling for earnings of $7.23 per share and revenue of $89.48 billion. These results would represent year-over-year changes of +6.48% and +3.58%, respectively.
Investors might also notice recent changes to analyst estimates for PepsiCo. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.05% lower. PepsiCo is currently a Zacks Rank #3 (Hold).
Valuation is also important, so investors should note that PepsiCo has a Forward P/E ratio of 24.57 right now. Its industry sports an average Forward P/E of 23.33, so we one might conclude that PepsiCo is trading at a premium comparatively.
We can also see that PEP currently has a PEG ratio of 3.22. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Beverages - Soft drinks stocks are, on average, holding a PEG ratio of 2.95 based on yesterday's closing prices.
The Beverages - Soft drinks industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 98, putting it in the top 39% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.